We skillfully drive results and proactively manage risks.
Real estate development is complex in almost every aspect. Real Projectives’® (RPL) expertise ranges across the gamut of property development including:
- expanding an existing site,
- repositioning a current property for better results,
- adaptive reusing, converting, and redeveloping—changing a property from one use to different use (e.g., hotel to apartments, industrial to apartments, retail to mixed-use, industrial to office, office to residential,
- to constructing new buildings on either undeveloped “greenfield” sites or by demolishing an existing structure and replacing it with another.
RPL provides these categories of development services:
- Investment Due Diligence Support
- Development Oversight
- Team Augmentation
- Development Sponsorship
Investment Due Diligence Support
Frequently a developer partners with one or more money sources to finance expensive deals. RPL commonly represents the money partners as clientele. Prior to commitment of equity and/or debt it is important that the financier critically evaluates the factors driving potential returns and those risks that could erode or even totally wipe out expected returns or damage its reputation.
Equity providers and lenders typically have strong financial acumen but need assistance to study the technical and contracting aspects of each deal. To bolster their due diligence and pre-closing processes, clients who have little development knowledge to some of the largest institutional equity providers in the world trust RPL with identifying and evaluating the proposed product, people, processes, schedule, and budget for one to dozens of intended development deals.
RPL works closely with client staff and their other market, legal and financial advisors, raising astute questions, providing defensible opinions, and methodically tracking each step with a checklist customized to the specifics of each deal. We review and advise on critical assumptions and essential documentation to establish more realistic expectations and likely outcomes on topics that may include:
- Program Goals and Product Description
- Market Economics and Positioning
- Sponsor Experience, Team Organization and Capacity
- Land and Environmental Conditions
- Zoning and Entitlements, Permits and Inspections
- Site Plans and Infrastructure
- Building Designs and Features
- Architect and Engineering Qualifications and Agreements
- Contractor Qualifications, Pricing and Contract Terms and Conditions
- Project Milestones and Construction Schedules
- Project Budget, Key Assumptions and Contingencies
- Risk Management
Initially comments may be made simply on an offering package or letter of intent, when we identify top risks that must be resolved prior to closing and formulate acceptable approaches to mitigate the risks that continue post-closing. Then deeper into negotiations we work with both client and developer to verify that all contingencies have been met and that any significant new matters are dealt with appropriately in the venture and loan agreements, as well as with assigned responsibilities prior to closing on the joint venture and/or development loan(s).
Upon closing of a deal through the challenges of entitlements, design, construction, and delivery, and the eventual refinancing, sale, or disposition of a project, we monitor, oversee, and advise on a full spectrum of associated development risks. However, unlike a typical bank inspector that tends to review the past, RPL takes great pride adding value with good questions and sharing best practices, and always looking forward to proactively protect our client’s critical interests—their money, time, and reputation. In addition to making sure invoices and funding requests represent work earned, we track schedule, quality, changes, communications and how well the team is communicating and making decisions to forecast outcomes and suggest improvements to process.
Nearing substantial completion of development, we may get involved in coordinating furniture, fixtures and equipment installation, setting up for leasing and transitioning the project from construction to occupancy. We’ll then facilitate final negotiations, collection of close out documentation, and administrative close out of projects.
We’ve seen a diverse range of projects, developers, and teams—some who have built similar projects many times and others who might be undertaking their first such project with institutional money. We modulate our oversight efforts as needed depending on the experience, capacity, and confidence in how each deal is structured and managed. We combine our real estate, design, and construction acumen with exposure to ways other providers do business on other types of projects and locations. Then we approach the customary review of schedule and billing progress for the betterment of each deal.
Throughout the following three phases of development, we customize our services to protect our client’s interest regarding each specific project, goals, and risks. Selective (not comprehensive) tasks may include:
- Tracking of entitlements
- Engagement of architects, engineers, and necessary consultants
- Review of drawings and specifications
- Evaluation of project budgets and adequacy of contingencies
- Qualification and negotiation of general (or prime) contractor(s)
- Procurement of insurances and bonding
- Visiting the site (typically monthly) to observe progress and quality
- Review and advice on invoices, applications for payment and funding requests
- Tracking of schedule, procurement, and adverse impacts
- Review and advise on issues, changes, and claims
- Participation in observations and punch list processes
- Advise regarding substantial and final completion, and any liquidated damages
- Compilation of record documents
- Tracking of temporary and permanent certificates of occupancy
- Transfer from builders’ risk to permanent insurance programs
- Reconciliation, negotiation, and settlement of final amounts to be paid